xinhua silk road logo xinhua silk road logo
Subscribe CustomBlackClose

Belt & Road Weekly Subscription Form

download_pop

Research ReportCustomBlackClose

The full edition of the report is available at Xinhua Silk Road Database. You can click the “Table of Content” to have a general understanding of it.

Click on the button below to create your account and get immediate access to thousands of articles.

Start a Free Trial

maritime silk road search
InfoQuest

State-owned bank forecasts Thai economy to grow by 3.6 pct in 2019, 3.5 pct next year

July 26, 2019


Abstract : The research center of the GSB foretasted Thai economy to grow by 3.6 percent in 2019. The figure was lower than that in the previous year. This slowdown was mainly due to the hit of the trade war, which led to Thai baht appreciation that further weighed on the exports of goods and services.

The research center of the Government Savings Bank (GSB) foretasted Thai economy to grow by 3.6 percent in 2019. The figure was lower than that in the previous year. This slowdown was mainly due to the hit of the trade war, which led to Thai baht appreciation that further weighed on the exports of goods and services. Meanwhile, high household debt affected household purchasing power, according to Mr. Chatchai Phayuwannachai, director of GSB, on July 25 (Thursday), 2019. Whilst Thailand's economy is expected to grow by 3.5 percent in 2020.

Factors contributing to Thailand's economic growth in 2019 include the following points. First, the domestic political situation has returned to the normal trajectory and confidence of investors and consumers has been improved. Second, fueled by the foreign direct investment policy (FDI) launched by the government and substantial preferential policies for investment provided by Thailand's Board of Investment (BOI), investment in the private sector continues to grow. Third, the government distributes welfare cards and takes tax measures to shore up the economy, aiming to improve household purchasing power and promote domestic spending. Fourth, low interest rates and a downward trend in oil prices are conducive to reducing corporate costs. Fifth, the overall stability of the economy can enhance the confidence of foreign investors.

While risks undermining Thailand's economic growth in 2019 include: (1) The impact of the U.S.-China trade war and the surging baht will weigh on exports of goods and services. (2) Government spending is likely to fall short of targets, mainly because of budget delays, and the fiscal year 2020 budget spending bill may not be enacted as planned. (3) The slowdown in China's economy has weakened the purchasing power of Chinese consumers, who are the main buyers of high-end Thai real estate. It is expected to lead to a decline in Thai real estate growth. (4) Household debt still stands at a high level, and the quality of loans tends to deteriorate, striking household purchasing power. (5) The global economic slowdown coupled with the appreciation of the Thai baht resulted in a decline in tourism.

The overall economy is running smoothly, but there are some negative impacts due to the reduction of trade and service surplus. Oil prices are falling, thus slowing overall inflation. Meanwhile, core inflation dips as domestic purchasing power declines. In addition, monetary policy remains broadly ease to drive continued growth, Macroprudential and Microprudential regulations were implemented, and efforts were stepped up to restrict the strong baht by reducing the short-term bonds issued by the Bank of Thailand. These measures will help mitigate the vulnerability of the Thai economy and enable it to achieve stable and long-term development amid the slowdown of the global economy and in major trading partners.

Source: InfoQuest, by Kasamarporn Kittisamphan / Rachada, translated by Xinhua Silk Road

Notice: No person, organization and/or company shall disseminate or broadcast the above article on Xinhua Silk Road website without prior permission by Xinhua Silk Road.

Scan the QR code and push it to your mobile phone

Keyword: GSB Thailand economy

Reading:

Chinese firm launches ethanol processing plant in central Zambia

China Focus: China spurs nighttime economy to enhance economic vitality

Non-financial investment of Chinese firms in countries along B&R slows down in H1

China pledges to further cooperation with UK as new PM said "pro-China"

Xinhua Headlines: China's commercial space industry takes off with successful orbital launch

Write to Us belt & road login close

Do you want to be a contributor to Xinhua Silk Road and tell us your Belt & Road story? Send your articles to [email protected] and share your stories with more people.

Click on the button below to create your account and get im http://img.silkroad.news.cn/templates/silkroad/en2017te access to thousands of articles.

Start a Free Trial

Ask Us A Question belt & road login close

If you have any questions, please enter them in the box below.

Reload

Write to Us belt & road login close

Do you want to be a contributor to Xinhua Silk Road and tell us your Belt & Road story? Send your articles to [email protected] and share your stories with more people.

Click on the button below to create your account and get im http://img.silkroad.news.cn/templates/silkroad/en2017te access to thousands of articles.

Start a Free Trial